Residential Real Property Disclosure Act
The Residential Real Property Disclosure Act (765 ILCS 77) was passed in 1998 to protect home buyers from sellers who falsely report conditions of their property during a real estate transaction. The disclosure act is intended to provide buyers with a reliable representation on the major conditions of the property. Under this act, the seller has to deliver to the prospective buyer a written disclosure statement before the signing of a written agreement between the seller and the prospective buyer. The goal of the disclosure is to report any damages or material defects to the residential property.
According to the Act, material defects are required to be disclosed by the Seller. Based on a disclosed material defect, a prospective buyer may terminate the contract 3 business days after the receipt of the report (765 ILCS 77/40). Some Sellers fail to disclose material defects to the Buyers, which may result in a Buyer seeking damages. The Act provides a remedy for damages acquired by a prospective buyer of the residential property who discovers false information on the disclosure report before the closing transaction. If a seller knowingly violates the Act, “…he…shall be liable in the number of actual damages and court costs, and the court may award reasonable attorney fees incurred by the prevailing party.” (765 ILCS 77/55)
Under this disclosure act the seller is not liable if (1) the seller had no knowledge of the error, (2) the error was based on reasonable belief that a material defect had been corrected, or (3) the error was based on information provided by a licensed professional. In order to complete the disclosure statement, the seller is not obligated to make an investigation or inquiry into any defects. (765 ILCS 77/25) The seller does become liable if he or she fails to provide the disclosure. The disclosure document must be provided prior to the transfer of the residential real property. If the seller refuses or fails to provide the disclosure, the buyer does have the right to terminate the contract.
If you need assistance with a real estate transaction, local attorney Andrew Szocka provides thorough and speedy real estate transaction assistance in the Chicagoland area. To schedule a free initial consultation, visit the Law Office of Andrew Szocka, P.C. online or call the office at (815) 455 – 8430.